PSB Phase 2 presentation


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PSB Phase 2 presentation

  1. 1. Ofcom's second public service broadcasting review Phase 2: Preparing for the digital future 25 September 2008
  2. 2. Audiences should have a choice of providers <ul><li>Audiences value the BBC </li></ul><ul><li>But they also want PSB alternatives to complement the BBC </li></ul><ul><li>Stakeholder support </li></ul><ul><li>Enhances reach and impact </li></ul><ul><li>Valuable as an end in itself in news and current affairs </li></ul><ul><li>Valuable to audiences, who are willing to pay </li></ul>
  3. 3. The current model of ITV1 provision is broken Current costs soon exceed benefits 2009 2010 2011 ITV Wales Costs > benefits During 2009 ITV Plc Costs > benefits Before 2012 stv Costs > benefits 2009 - 2010 <ul><li>Post 2012: </li></ul><ul><li>UTV & GMTV: Benefits>costs </li></ul><ul><li>Five: Small net benefits </li></ul>1 2 3 4 Licence handback becomes a rational option for ITV Plc
  4. 4. Channel 4 should have a significant role, but it needs an economic model and funding to support this Note: Forecasts Channel 4’s financial shortfall by 2012. LEK's numbers based on EBITDA. Ofcom based on EBIT, due to differences in methodology £32 m £60 m £100 m £119 m
  5. 5. Estimated funding gap - after 2012 considerable uncertainty £330- 420 m £185 m £145 - 235m Total funding of £330 - £420m per annum may be needed by 2012
  6. 6. Institutions and competition should play important roles <ul><li>Reach </li></ul><ul><li>Values </li></ul><ul><li>Independence </li></ul><ul><li>Flexibility </li></ul><ul><li>Transparency </li></ul><ul><li>Efficiency </li></ul>Benefits Institutions Competition
  7. 7. Long term models for PSB in the future need refining 2. BBC only 1. Evolution 3. BBC/Channel 4 4. Broad competitive funding
  8. 8. All funding options identified in Phase 1 remain credible <ul><li>Regulatory assets </li></ul><ul><li>Direct public funding </li></ul><ul><li>Licence fee </li></ul><ul><li>BBC assets </li></ul><ul><li>Levy schemes </li></ul>
  9. 9. In the short term commercial PSBs' obligations must set them on a path consistent with the long-term models <ul><li>Ofcom’s proposed PSB priorities for ITV1 up to 2014: </li></ul><ul><ul><li>Original British programming, so quotas remain </li></ul></ul><ul><ul><li>UK and international news, so requirements unchanged </li></ul></ul><ul><ul><li>Peak-time current affairs unchanged but reduced outside peak </li></ul></ul><ul><ul><li>Peak-time news for the devolved nations unchanged but non-news minimum reduced </li></ul></ul><ul><ul><li>Current affairs in the nations unchanged </li></ul></ul><ul><ul><li>Regional news in England that prioritises peak-time over daytime and balances regional with local </li></ul></ul><ul><li>As part of this re-prioritisation: </li></ul><ul><li>- ITV1’s Out of London production quota reduced to 35%, in line with pre-2004 figure </li></ul><ul><li>Ofcom rejected the case for any change in: </li></ul><ul><ul><li>ITV1’s quota of independent productions </li></ul></ul>
  10. 10. In the short term commercial PSBs' obligations must set them on a path consistent with the long-term models <ul><li>five’s role in PSB up to 2014: </li></ul><ul><li>-Original production quota fixed at 50% </li></ul><ul><li> -News and current affairs unchanged </li></ul><ul><li> -New commitment by five to enhanced delivery of children’s programmes </li></ul>
  11. 11. Our core principles for the future <ul><li>BBC remains the cornerstone of PSC </li></ul><ul><li>Audiences should have a choice of providers in most areas of PSC </li></ul><ul><li>TV remains essential, but PSC should be delivered across platforms </li></ul><ul><li>Content for the devolved nations remains essential – particularly news </li></ul><ul><li>Institutional & competitive funding could play important future complementary roles </li></ul><ul><li>Channel 4 needs a new economic model to deliver its future public service contribution </li></ul><ul><li>ITV1 and Five retain important PSC roles up to 2014 with re-prioritised focus </li></ul><ul><li>After 2014, the case for obligations on ITV1 & Five is more evenly balanced </li></ul><ul><li>Most of the Phase 1 funding sources are credible - a mix may be needed in future </li></ul>